Multiple Choice
Suppose the interest rate is 5 percent. Consider four payment options: Option A: $500 today.
Option B: $515 one year from today.
Option C: $615 two years from today.
Option D: $690 three years from today.
Which of the payments has the highest present value today?
A) Option A
B) Option D
C) Option B
D) Option C
Correct Answer:
Verified
Correct Answer:
Verified
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